Comcast Puts In $65 Billion Bid For 21st Century Fox

Comcast made it official today. It, too, is pursuing 21st Century Fox, the global TV and entertainment conglomerate that Rupert Murdoch and family are putting up for sale. Disney has already struck a deal with Fox, but at $65 billion the new Comcast bid is almost 20 percent higher than what Disney's offering. The developments come one day after a federal judge approved another big merger.

Joining us now is NPR's David Folkenflik to talk more about it. Hey there, David.

DAVID FOLKENFLIK, BYLINE: Hey, Audie.

CORNISH: So remind us the context here. 21st Century Fox, as we said, huge conglomerate. What's in play?

FOLKENFLIK: Well, their major entertainment holdings. So that includes their TV and movie studios. That includes the FX channel and Fox Searchlight pictures. It includes their foreign satellite holdings like Sky in Europe. It includes their stake in Hulu, the streaming service, and a number of Marvel superhero characters that would be reunited with those that already are held over at Disney.

CORNISH: It's also a publicly traded company. So is Rupert Murdoch basically obliged to take the highest bid to keep shareholders happy?

FOLKENFLIK: Well, Murdoch and his family control about 40 percent of the voting shares of 21st Century Fox. So he just has to bring a decent percentage, a small number of folks along for the ride. He will have to make a persuasive argument that somehow the Disney deal is better. Presumably Disney is going to have to raise its bid. But the Disney deal is - as currently structured involves shares in the Disney company, and Comcast is all cash.

That has tax implications for the Murdochs and potentially for certain other shareholders. They may be able to argue that the structuring of the deal is favorable or that they think Disney's stock long-term will be a better bet. But, you know, the Murdochs are going to have to take this seriously.

They issued a statement this evening saying they still have the merger agreement with Disney, but that they're going to have to consider this and have not yet decided whether to push off their July 10 meeting at which they were going to vote to try to get shareholder approval of the Disney deal.

CORNISH: Comcast, Disney, AT&T - these are enormous companies. And yet I'm hearing that they're worried about Netflix. Is that such a big challenge?

FOLKENFLIK: Well, I think that Netflix - you know, if you looked just at how the market values these companies, Netflix and Comcast and Disney are all giants. They're all valued at about 150 billion. Netflix is willing to spend many more billions a year on creating original content that any of these traditional Hollywood studios can do. And also, it's not alone. You're going to see - you're seeing not only Amazon in play, but Apple is intending, anyway, to spend, you know, significant money to enter the field as well.

So somebody like Murdoch looks at that and says, I can't quite compete. I'm not going to be able to do it myself. Let me go under a larger umbrella, sell these properties off to somebody big like Disney and see if they can take them on. It's worth pointing out, of course, that Murdoch intends to hold onto Fox News as well as the Fox broadcast network and a couple other properties.

CORNISH: Before I let you go, this court decision yesterday, the one that approved another big media merger, the AT&T and Time Warner, what's the connection? Like, why did Comcast act today?

FOLKENFLIK: So, you know, look; if Disney or Comcast were to take over these Fox properties, it would be more of taking over a rival or a competitor bid. But the fact that a judge said that this deal where AT&T and Time Warner can get together in different elements of the entertainment business - that is, the pipelines that supply them to people's homes and the actual content itself - if the judge had knocked that down, it would have cast a pall over it saying, we still think that antitrust issues are alive even if it's a differently structured kind of deal. After this happened, a lot of people were celebrating in a lot of corporate suites because they said, you know, doors are open for business. And that's what they're hoping here.